"1. Too much dependency on the intermediaries: SHGs (self-help groups) are mostly promoted and maintained by NGOs, starting from group formation to the operations. In almost all SHGs, the meeting, decision making, election of leaders, accounting, book keeping, bank linkages etc. are done by the implementing NGO staffs. The moment the NGOs withdraw their support from their SHGs, the SHGs were found to be helpless, hence unable to organise and maintain their banking structure. Many of the SHGs ended up with intra-group conflicts."
"2. Diffusion of missions over time: SHGs are primarily not made for microfinance rather made for self-help, women empowerment, capacity building to face social problems etc. So, the rigidity for microfinance is diffused over time in SHG-based interventions."
"3. Economic threshold limit: It is the limit at which the external banking of the SHGs is stopped, i.e. the banking transactions between the SHG and the SHG-linked bank (the bank where the SHG had opened its account) is seized. At this point of time, it can be considered that the SHG has reached the threshold limit..."
"4. Economic injury limit: This is the limit at which the internal banking of a SHG seizes, which means that the saving, credit, group meeting etc. are no more continuing. At this point, it can be considered that the SHG will die in coming time. After 'economic injury limit' generally the SHGs come up with internal conflicts among the members on various issues. It is difficult to reorganise the SHG again after it has reached the economic injury limit."
(Debadutta K. Panda in 'Understanding Microfinance,' p. 104 Wiley India)
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